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United Capital grows net profit by 16% to N1.91bn in H1



United Capital Plc braced the lockdown in the second quarter to sustain double-digit growths in key performance indices in the first half with net profit rising by 16 per ceUnited Capital grows net profit by 16% to N1.91bn in H1to N1.91 billion.

Key extracts of the interim report and accounts of United Capital for the six-month period ended June 30, 2020 released at the weekend indicated that total turnover rose by 37 per cent to N4.45 billion in first half 2020 as against N3.24 billion recorded in comparable period of 2019. Operating income leapt by 45 per cent from N2.82 billion to N4.10 billion. Profit before tax improved by 14 per cent to N2.27 billion as against N1.99 billion. After taxes, net profit stood at N1.91 billion in first half 2020 compared with N1.65 billion in first half 2019. With these, earnings per share increased from 28 kobo in first half 2019 to 32 kobo in first half 2020.

Further analysis showed that the total assets expanded by 46 per cent to N219.73 billion in June 2020 as against N150.46 billion recorded by the year ended December 31, 2019.                 Total liabilities however increased by 54 per cent from N130.88 billion in December 2019 to N201.60 billion in June 2020. Shareholders’ funds thus dropped marginally by 7.5 per cent from N19.59 billion in December 2019 to N18.12 billion in June 2020.

The increase in total liabilities was due largely to 95.22 per cent growth in managed funds, 22.56 per cent increase in current tax liabilities and 15.96 per cent rise in other liabilities. The decline in shareholders’ funds was due to decline in retained earnings and considerable increase in the negative other reserves.

The top-line performance was driven by significant increases across the income lines. Net interest margin rose by 347.65 per cent while net trading income and fee and commission incomes grew by 85.03 per cent and 77.15 per cent respectively.

Group Chief Executive Officer, United Capital Plc, Mr. Peter Ashade,  said United Capital remains a leader in the financial and investment services space as it continues to leverage on innovation, technologies and bespoke services to meet private and public sector’s finances.

He noted that while the COVID-19 pandemic has lasted than envisaged and caused greater speculations of global recession and slower global recovery from the pandemic, the company’s well-articulated plans have ensured that it was still able to deliver growth.

“The Nigerian economy has been greatly affected by the pandemic as seen in the increasing depreciation of the exchange rate, inflation rate and other economic indicators. As we stated at the release of our last quarter result, our business was not immune to these challenges; however, the group was able to endure the challenges- thanks to the well-articulated and diligent implementation of our plans set out last year,” Ashade said.

According to him, with its well-articulated plans, business continuity plan in economic crisis and solid risk assessment framework, the group was able to deliver increased revenue of over 37.26 per cent, increased pre-tax profit of 14.10 per cent and profit after tax growth of 15.98 per cent.

He pointed out that during the first half, the company successfully issued its N10 billion Series 1 bond under the N30 billion medium-term debt programme with over 24 per cent oversubscription.

“Going into the remaining half of the year, we remain assiduously committed to deliver greater returns to our shareholders, by constantly reviewing our strategy in the light of global and domestic happenings, ensuring that we provide value to all our stakeholders from time to time,” Ashade said.

He outlined that in line with the company’s initial strategy for the 2020 business year, it shall continue to push further its arket diversification and cost-optimisation initiatives as well as implement phased automation of its business processes while upholding its commitment to ensuring a significant improvement in value delivery to all stakeholders.

capital market

Naira closes at N881/$ in official trading window



The Nigerian Naira on Tuesday depreciated 7.63 percent to close at N881.88 to a dollar at the close of business on Tuesday, data from the NAFEM where forex is officially traded, showed./ /

Nigerian NewsDirect also gathered that the naira traded N1157 to a dollar at the close of market in the parallel market./ /

This represents an N67.28 loss or a 7.63 percent decline in the local currency compared to the N814.60 it closed on Monday.

The intraday high recorded was N1159/$1, while the intraday low was N701/$1, representing a wide spread of N458/$1./ /

According to data obtained from the official NAFEM window, forex turnover at the close of the trading was $118.06 million, representing a 17.99 percent increase compared to the previous day.

Similarly, the naira weakened at the parallel forex market where forex is sold unofficially, the exchange rate depreciated by 0.17 percent, quoted at N1157/$1, while peer-to-peer traders quoted around N1160.18/$1. 

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capital market

FBNH, Access Corporation lead gainers on NGX



First Bank of Nigeria Holdings and Access Corporation led gainers on the Nigerian equities market on Monday.

This is as investors also lost N132.43billion on the Nigerian equities market yesterday.

The NGX All-Share Index advanced by 0.17 percent, closing at 71,353.81 basis points, compared to the previous day’s gain of 0.25 percent, which closed at 71,230.48 basis points.

YTD, the NGXASI stands at 39.22 percent. 

The total volume traded advanced by 28.12 percent to close at N746.67 million, valued at N5.95 billion and traded in 9,267 deals. UNIVINSURE was the most traded stock by volume with N161.10 million, while ACCESSCORP was the most traded stock by value with N1.47 billion units traded.

The Gate Index closed flat at 188.47, while the Toni index advanced by 1.39 percent to close at 371.15 basis points.

At the close of trading, the market recorded 32 gainers, 20 losers, and 69 unchanged. FBNH topped the gainers list, while ETRANZACT topped the list of losers.

Thus, market breadth closed positively as the Market Breadth Index (MBI) is 0.17x.

UNIVINSURE had the highest volume contribution with 21.58 percent, while ACCESSCORP and UNITYBNK followed closely behind.

According to the value chart, ACCESSCORP is at the top with a 24.68 percent contribution. UBA and ZENITHBANK followed closely behind.

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capital market

FG raises oil price, exchange rate projections



The Federal Government of Nigeria has pegged its 2024 projections for crude oil and the dollar to naira exchange rate at $77.96 and N750 respectively.

This new projection is a deviation from the earlier projection announced by Atiku Bagudu, Minister of budget and planning in October.

Bagudu had earlier stated that the FEC established a reference price of $73.96 per barrel for crude oil and an exchange rate of N700/$ as key assumptions for budgetary planning.

“Now, it was presented on the background of the commendable measures that have been taken since June in order to restore macroeconomic stability by particularly the deregulation of petroleum prices, which we maintained that subsidies are gone and indeed the regulation of the foreign exchange market,” he said.

Nigerian NewsDirect however gathered that the projected crude oil price benchmark by the Federal Government is below the $94.91 projection of the US Energy Information Administration (EIA) and the $100 a barrel forecast by Goldman Sachs for next year.

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